Some market watchers think Chinese buying is propping up interest rates, even as the U.S. economy improves. But good news about growth could get the upper hand later this year.

Thursday's strong employment data failed to send bond yields significantly higher, suggesting that heavy demand for bonds from overseas buyers is outweighing domestic economic improvement. Many bond-market watchers, including David Woo, head of global rates and currencies research at Bank of America Merrill Lynch, think China is the hungry buyer, and has been for much of this year.

Woo doesn't expect the Chinese shopping spree to persist to the same degree for the rest of the year, however. He sees a combination of slowing...